Elbowing Out the Used-car Salesman
E-commerce ▶ On Vroom’s website, there’s no haggling and shipping is free ▶ “We have to make sure the car is amazing”
About a year ago, violent storms hit the Houston area. When the floodwaters receded, Vroom, an online seller of used cars, discovered it had lost more than 100 vehicles, equal to about $3 million in sales. It was a reminder that the two-year-old Web startup faces some of the same challenges as a brickand-mortar retailer.
Vroom is one of several companies seeking to consolidate the fragmented used-car market. But unlike rivals Beepi, Shift Technologies, and Carvana, which mostly connect buyers and sellers via online marketplaces, New York-based Vroom buys all of its cars, then refurbishes and guarantees them—much the way a traditional dealer does.
Allon Bloch, the former venture capitalist who runs Vroom, says many Americans who are happy snapping up a $10 shirt online remain leery about going there to buy a car, typically the second-biggest purchase after a home. “If a consumer spends tens of thousands of dollars on a car that they’ll use for many hours every week and may own for years, we have to make sure the car is amazing both